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Asia: Stocks mixed as trade talks, Fed in focus

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[SYDNEY] Asian stocks started the week mixed at the start of a week expected to see US-China trade talks resume and the Federal Reserve deliver its first interest-rate cut in a decade.

Equity benchmarks dipped in Japan and South Korea, while Australian shares nudged higher. US futures were stable after the S&P 500 and Nasdaq Composite indexes hit fresh records Friday on a rally in technology shares. Treasuries were little changed, as was the US dollar in the wake of comments Friday from White House economic adviser Larry Kudlow that the US ruled out currency intervention.

President Donald Trump later said "I didn't say I'm not going to do something" on the exchange rate.

Investors will be picking through any developments on trade as Chinese and American negotiators gather Tuesday for two days of talks, three months after negotiations broke down. Neither side is signalling much hope for a breakthrough.

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Meanwhile, Fed Chairman Jerome Powell's post-meeting press conference later in the week will provide an opportunity to gauge the trajectory of US rates after the central bank is tipped to boost stimulus.

Corporate earnings will remain a focal point as investors remain vigilant of any signs a global economic slowdown is being reflected in companies' bottom lines. Among major earnings this week, Apple, Rio Tinto and carmakers Toyota and BMW.

Elsewhere, oil traded lower ahead of the trade talks.

Bank of Japan rate decision and Governor Haruhiko Kuroda briefing are due Tuesday.

US Trade Representative Robert Lighthizer and his team meet their Chinese counterparts in Shanghai Tuesday.

Fed officials begin their two-day meeting on monetary policy in Washington Tuesday. Chairman Jerome Powell will hold a press conference following the FOMC's decision Wednesday.

Australia inflation data is due Wednesday. The Bank of England policy decision is due Thursday, and US July jobs report is due Friday.

Stocks

Topix index slipped 0.1 per cent as of 9.03am in Tokyo.

Australia's S&P/ASX 200 Index rose 0.1 per cent.

South Korea's Kospi index fell 0.5 per cent.

Hong Kong's Hang Seng Index futures dipped 0.1 per cent.

S&P 500 futures were little changed. The S&P 500 gained 0.7 per cent Friday.

Currencies

The yen was steady at 108.65 per US dollar.

The offshore yuan was at 6.8816 per US dollar.

The Bloomberg Dollar Spot Index nudged lower.

The euro traded at US$1.1130.

The pound was at US$1.2376.

Bonds

The yield on 10-year Treasuries was at 2.06 per cent.

Australia's 10-year bond yield fell three basis points to 1.2 per cent.

Commodities

West Texas Intermediate crude fell 0.2 per cent to US$56.08 a barrel.

Gold was up 0.1 per cent to US$1,420.09 an ounce.

BLOOMBERG